By Michael Giles
DRIVING up to Melbourne over the weekend, it was surprising, and a little alarming to see how far residential growth is pushing out to Pakenham and beyond, at a great rate of knots at the moment.
Not only is housing rapidly filling all available sites on the northern side of the highway but a huge new area is being opened up on the south side as well, at the top of Cardinia Road where it joins the freeway.
By the look of it, this new area of growth will extend all the way down to the little settlement of Cardinia itself, where you’ll often see cricketers enjoying that beautiful setting, on a lush oval ringed by shady oaks.
A couple of other observations come to mind.
Far from opening up the opportunity for affordable housing, these blocks on the south-eastern outskirts of Melbourne are apparently selling for $300,000 plus for a mere 500m2 allotment, or $100,000 more if you step up to a 700m2 block.
Then you’ve got your house on top of that, not much change out of $600,000 or $700,000.
Clearly obscene profits are being made by developers here, far in excess of what they need as encouragement to develop the land for housing in the first place and government should be taking a much bigger community dividend out of these profits, on an on-going basis, in order to pay for the required infrastructure.
Not only do these areas need schools, roads and playing fields but they also need a much better connection into the city by rail and it’s time the State Government reassessed the requirements around developer contributions from these massively over-remunerated “investors”.
Other issues of concern include how far this residential growth should be allowed to push into the magic black soils that were once part of the Koo Wee Rup swamp and now highly productive asparagus and veggie growing areas.
Another thing that is pushing people out of the inner suburban living they’d prefer is the amount of speculative and negative-gearing investment going on in the traditional suburbs.
Certainly a lot of these places are available for rent but with rental returns needing to reflect the high cost of buying inner city real estate, many people are being priced out of the market and forced to consider moving to the outskirts.
A few things need to happen – government should take a bigger cut from developers, and the negative-gearing and foreign investment that is overheating the market needs to be phased out.
It’s simply not fair for a handful of developers and investors to be making mega profits at the expense of ordinary mum and dad wage-earners.
A better rail system out to Pakenham and beyond – well that’s an absolute no-brainer.